Chill out, everybody

By now you have probably heard that Apple CEO Steve Jobs has taken a leave of absence for medical reasons. It's a bummer, and I wish Steve a speedy recovery. But the time to panic is, well, it's not now.

First of all, understand that it is exceedingly unlikely that Steve has a recurrence of his cancer. I won't belabor the details, but for those who are curious, Orac did a wonderful explanation of the type of cancer Jobs had and the likely complications. He had some serious replumbing of the digestive tract which can result in a variety of chronic complications, including:

glucose intolerance or even diabetes requiring insulin; malabsorption because of diminished production of pancreatic enzymes; delayed gastric emptying; the afferent loop syndrome; or the "dumping syndrome," which is common after stomach resections and results from undigested food being "dumped" too fast into the proximal small intestine, which draws in fluid.

Malabsorption is certainly the most likely explanation for Job's dramatic weight loss. Orac thinks it is due to an afferent loop syndrome, which seemed plausible to me but doesn't jibe well with Apple's statement that this is a 'hormonal' problem. Either way, the likelihood of this being cancerous is very small, and the outlook for Jobs' return should be good if this is indeed a digestive complication.

So don't sell your Apple stock tomorrow, or the next day. Yeah, everybody thinks Jobs is Apple and Apple is Jobs so the stock will probably dive 15% or more. But hell, it's down from $200 to $85, so if you've still got AAPL in your portfolio, this won't be your biggest loss of the last twelve months. But there's plenty reason to be long AAPL (to the degree you can be long on anything in this economy) -- Jobs is the prima donna, but he has one hell of a supporting staff that has helped make him the famous genius and visionary that he is viewed as. He may not be replaceable, but he is not quite as central to Apple's success as he is generally thought.

Apple has the best supply chain and distribution networks in the business. Who built those? Jobs? No, Tim Cook, COO (and now, I guess, iCEO). Apple is sitting on almost $20 Billion in cash. They could buy Ford and GM in cash and have change left over. Whose genius is that? Peter Oppenheimer, CFO. Whose visions have produced Apple's trademark brushed aluminum and luminescent plastic designs? Jonathan Ives. Sure, Jobs is the queen bee, and deserves all the credit he receives. But his functions are replicable, and Apple will do just fine without him at the helm.

In fact, this may be a blessing, long-term. Consider Bill Gates' long, seamless transition from the public face of Microsoft to his departure. Presuming that Jobs can come back, this does force Apple to develop and even dry-run a succession plan. I would not be entirely surprised if Jobs' six-month sabbatical turns into a year, and in 2010 he returns as some sort of "Chief Visionary Officer" or some such non-operational leadership position, keeping himself involved, but setting the stage for a more measured transfer of power.

I'll miss the Cult of Steve. It was fun to be wowed by his coy "Oh, one more thing..." bombshells, and the mythology of his "Reality Distortion Field" was amusing. But for the sake of the company and the awesome products it continues to turn out year after year, it's just as well that it come to an end.